Taking their downtrend to the fifth straight session, Indian equity benchmarks experienced a sharp decline on Friday, due to risk aversion in the global markets after the hawkish stance of the US Federal Reserve. Selling pressure was evident across sectors, with Realty, Power and Capital Goods taking the hardest hits. After making a slightly positive start, key gauges traded with volatility in first half as foreign investors continued their selling spree amid the US Federal Reserve’s hawkish stance on interest rate cuts for 2025. Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Thursday, as they offloaded shares worth Rs 4,224.92 crore, according to exchange data.
Markets steadily weakened in late afternoon session amid widespread sectoral weakness. Some concern also came as the central government has proposed a new bill to curb unregulated lending and provide for imprisonment of up to 10 years for violators, besides monetary penalties. With a view to curb unregulated lending activities and protect the interest of consumers, the RBI's Working Group on Digital Lending submitted its report in November 2021. Traders overlooked report that the Central government has released Rs 47,225 crore to the states and union territories under the Smart Cities Mission till November 15 and out of which Rs 44,626 crore has been utilised. Union Minister of State for Housing and Urban Affairs Tokhan Sahu said the work orders have been issued till November 15 in 8,066 crore amounting to Rs 1,64,669 crore, of which 7,352 projects (i.e. 91 per cent of total projects) amounting to Rs 1,47,366 crore have been completed under the mission. Meanwhile, Sebi decided to extend the deadline for listed companies’ value chain partners to comply with the Business Responsibility and Sustainability Reporting (BRSR) requirements.
On the global front, European markets were trading lower as the U.S. faced a government shutdown and U.S. President-elect Donald Trump warned of potential tariffs on the European Union if the bloc does not cut its growing deficit with the United States by making large oil and gas trades with the world's largest economy. Asian markets settled mostly down on Friday as concerns persisted about the Federal Reserve's rate trajectory and the U.S. faced a government shutdown after President-elect Donald Trump abruptly rejected a bipartisan plan. Back home, on the sectoral front, there were some reaction in coal industry stocks as the Coal Ministry stated that India’s coal imports during the April-October period of financial year 2024-25 witnessed a major decrease of 3.1 per cent, reaching 149.39 million tonnes (MT) compared to 154.17 MT in the corresponding period of last year.
Finally, the BSE Sensex fell 1176.46 points or 1.49% to 78,041.59, and the CNX Nifty was down by 364.20 points or 1.52% to 23,587.50.
The BSE Sensex touched high and low of 79,587.15 and 77,874.59 respectively. There were 2 stocks advancing against 28 stocks declining on the index.
The broader indices ended in red; the BSE Mid cap index fell 2.43%, while Small cap index was down by 2.11%.
The top losing sectoral indices on the BSE were Realty down by 4.07%, Power down by 3.55%, Capital Goods down by 3.02%, Industrials down by 2.67% and Utilities down by 2.60%, while there were no gaining sectoral indices on the BSE.
The few gainers on the Sensex were Nestle up by 0.12% and Titan Company up by 0.07%. On the flip side, Tech Mahindra down by 3.97%, Mahindra & Mahindra down by 3.60%, Indusind Bank down by 3.53%, Axis Bank down by 3.28% and Tata Motors down by 2.73% were the top losers.
Meanwhile, CareEdge Ratings in its latest report has said that India’s solar equipment manufacturing capacity is poised for healthy growth over the next 2-3 years, entailing a capex of nearly Rs 1 lakh crore. It stated of that Capex, an estimated debt funding of nearly Rs 70,000 crore is expected over the medium term, including investments in polysilicon and wafer capacities.
India’s renewable energy capacity stood at 155 Gigawatt as of September 2024, with the solar segment being the largest contributor at 91 GW, thanks to significant capacity additions over the past 7-8 years. The rising share of renewable energy capacity is due to strong policy focus, improving tariff competitiveness, and strong investor interest.
While India installed 18.5 GW of renewable energy capacity in 2023-24, it expects the annual installations to surpass 35 GW over the next two years, primarily supported by a healthy pipeline of more than 100 GW. The growth in solar capacity in the medium term will be driven by an annual tendering target of 50 GW renewable energy capacity through renewable energy implementing agencies, with the majority expected from solar. Significant capacity additions of 20 GW will come from rooftop solar, hybrid solar components, and off-grid solar over the next 2-3 years.
The government is proactive in its policy - it supports the industry through tariff and non-tariff barriers to drive demand for Indian players. To safeguard domestic cells and modules against the predatory pricing of Chinese counterparts, the government imposed a Basic Customs Duty (BCD) of 25 per cent and 40 per cent on Chinese cells and modules respectively, effective from April 01, 2022. The duty remains a key tool in enhancing the cost-competitiveness of domestic modules.
The CNX Nifty traded in a range of 24,065.80 and 23,537.35. There were 5 stocks advancing against 45 stocks declining on the index.
The top gainers on Nifty were Dr. Reddy's Lab up by 1.49%, JSW Steel up by 0.59%, ICICI Bank up by 0.40%, Nestle up by 0.21%, and HDFC Life Insurance up by 0.03%. On the flip side, Tech Mahindra down by 3.90%, Axis Bank down by 3.51%, Indusind Bank down by 3.47%, Mahindra & Mahindra down by 3.24% and Trent down by 2.99% were the top losers.
European markets were trading lower; UK’s FTSE 100 decreased 76.2 points or 0.95% to 8,029.12, France’s CAC fell 81.46 points or 1.13% to 7,212.91 and Germany’s DAX lost 220.98 points or 1.12% to 19,748.88.
Asian markets settled mostly down on Friday ahead the US Personal Consumption Expenditure data, the Fed's preferred inflation measure due later in the day, which is expected to play a crucial role in shaping Fed's interest rate path under the incoming Trump administration. Meanwhile, investors were also cautious over a potential US government shutdown. Chinese shares fell after China’s central bank kept its loan prime rates unchanged. The People's Bank of China kept its one-year loan prime rate steady at 3.1% and its five-year loan prime rate at 3.6%. Japanese shares declined after data showed the annual inflation rate in Japan climbed to 2.9% in November 2024 from 2.3% in the prior month, marking the highest reading since October 2023. Moreover, South Korean shares tumbled after the US Federal Reserve signalled a slowdown in the pace of rate cuts.
Asian Indices | Last Trade | Change in Points | Change in % |
Shanghai Composite | 3,368.07 | -1.96 | -0.06 |
Hang Seng | 19,720.70 | -31.81 | -0.16 |
Jakarta Composite | 6,983.86 | 6.62 | 0.09 |
KLSE Composite | 1,591.41 | -8.68 | -0.54 |
Nikkei 225 | 38,701.90 | -111.68 | -0.29 |
Straits Times | 3,719.93 | -42.95 | -1.15 |
KOSPI Composite | 2,404.15 | -31.78 | -1.32 |
Taiwan Weighted | 22,510.25 | -422.00 | -1.87 |